Simplification of operational process and clarifying regarding the cash flow disclosure in Corporate Bond Database pursuant to review of Request for Quote (RFQ) Platform framework. - SEBI - SEBI/HO/DDHS/DDHSPOD1/P/CIR/2025/72

CIRCULAR SEBI/HO/DDHS/DDHSPOD1/P/CIR/2025/72 May 13, 2025 To, Issuers who have listed Non-convertible Securities, Securitised Debt Instruments, Municipal Debt Securities and Commercial Paper; Recognised Stock Exchanges and Clearing Corporations; Registered Depositories; Stock Brokers and Depository Participants Madam/ Sir, Subject: Simplification of operational process and clarifying regarding the cash flow disclosure in Corporate Bond Database pursuant to review of Request for Quote (RFQ) Platform framework. Based on the recommendations of the working group formed for the purpose of review of RFQ platform and due public consultation on the proposals and feedback thereat, the following has been decided: 1. Simplification of the operational process relating to yield to price computation on the Request for Quote (RFQ) Platform 1.1. Chapter XXII of the SEBI Master Circular for issue and listing of Non-convertible Securities, Securitised Debt Instruments, Security Receipts, Municipal Debt Securities and Commercial Paper dated May 22, 2024 ( NCS Master Circular ) stipulates provisions for trade execution and settlement of trades in listed Nonconvertible Securities, Securitised Debt Instruments, Municipal Debt Securities and Commercial Paper on the RFQ platform of the Stock Exchanges. 1.2. In order to simplify the process of yield to price computation for non-convertible securities, cash flow dates regarding payment of interest/ dividend/ redemption for the securities traded on RFQ platform for the purpose for yield to price computation shall not be adjusted for day count convention and shall accordingly be based on the due date of payment as per the cash flow schedule and not as per the date of payment. 1.3. Accordingly, the following clause will be inserted as clause 9 in the said Chapter XXII of NCS Master Circular: (9) Yield to Price computation In order to simplify the process of yield to price computation for non-convertible securities, cash flow dates regarding payment of interest/ dividend/ redemption for the securities traded on RFQ platform for the purpose for yield to price computation shall not be adjusted for day count convention and shall accordingly be based on the due date of payment as per the cash flow schedule and not as per the date of payment. 2. Disclosure of cash flow regarding payment of interest/ dividend/ redemption in the centralized corporate bond database. 2.1. Clause 3.3.34 of Schedule I of the SEBI (Issue and Listing of Non-Convertible Securities) Regulations, 2021 requires Issuer to disclose cash flow with date of with date of interest/dividend/ redemption payment as per day count convention in the offer document. 2.2. Chapter XIV of the NCS Master Circular requires issuers to submit and update certain information in the centralized database at the time of activation of the ISIN and post listing of securities. Presently, the information regarding the cash flow schedule is not captured in the centralized bond database. 2.3. In order to have such information regarding corporate bonds at one place, the following paragraph shall be inserted as paragraph 57 in Annex-XIV-A of NCS Master Circular Cash flow schedule regarding payment of interest/ dividend/ redemption in the centralized corporate bond database at the time of activation of ISIN in the following format: Sr. No. Particulars Due Date Payment date as per day count convention 1 Payment of interest/ dividend/ redemption XXX XX In case of any change in the information pertaining to cash flow regarding interest/ dividend/ redemption during the tenure of the securities, the same shall be updated within one working day in the centralized corporate bond database. 3. The aforesaid disclosure requirement shall be applicable for prospective issuances of debt securities and for the residual maturity of the ISINs that are already listed. 4. This circular shall come into force with effect from August 18, 2025 5. The Stock Exchange(s)are directed to bring the provisions of this circular to the notice of the market participants and also disseminate the same on their websites and make necessary amendments to the relevant bye-laws, rules and regulations for the implementation of the above directions in coordination with one another to achieve uniformity in approach. 6. The Circular is issued in exercise of the powers conferred under Section 11(1) of the Securities and Exchange Board of India Act, 1992 read with Regulation 55 (1) of the SEBI (Issue and Listing of Non-convertible Securities) Regulations, 2021 to protect the interest of investors in securities and to promote the development of, and to regulate the securities market. 7. This Circular is available at www.sebi.gov.inunder the link Legal Circulars . Yours faithfully, Rohit Dubey General Manager Department of Debt and Hybrid Securities +91-022 2644 9510 [email protected]